Georgia Republicans blame the housing industry melt down and the financial crisis of 2007 on the federal government and a bunch of laws from as early as 1968. Those laws include the Fair Housing Act of 1968, the Equal Credit Opportunity Act (EOCA) of 1974, the Home Mortgage Disclosure Act (HMDA) of 1975, and the Community Reinvestment Act (CRA) of 1977.

Of these the CRA merely requires banking regulatory agencies to ensure that banks and savings associations “serve the credit needs of their local communities in a safe and sound manner.”

Then along comes this gem in the news today. It seems some $80 million dollars in fraud happened at a Georgia bank with the help of a couple of executives and insiders.

U.S. Attorney Sally Quillian Yates said Friday the developer, 50-year-old Guy Mitchell of Coral Gables, Fla., used some of the loan money to buy a private island. She says the executives, 40-year-old Douglas Ballard and 42-year-old Joseph Todd Foster, dumped their Integrity stock before the failed loans came to light.

The indictment alleges that with the assistance of individuals within the bank, Mitchell, who was to appear in court Friday, paid interest on existing loans with money from other loans, and kept borrowing to pay interest.

 Yup, the federal government used the Community Reinvestment Act to force that bank to make loans to people who shouldn’t buy houses.